EURAUD – Point & Figure

EURAUD –

The EURAUD pair has bubbled along since June without providing a clear directional bias. The price, caught within a range, has looked static and uninteresting, but that could all be about to change as we study the point and figure levels above.

Firstly, the price action itself may be suggesting a switch to an overriding bullish move to cap off this long period of consolidation. Note how we’ve seen several tests of linear support and resistance throughout this range until now. It would seem EURAUD may have just printed a higher low to push the price in an upward trajectory.

Just this afternoon, we see demand generating a buy signal as demand surged past the double-top at 1.6563. Of course, this could well be a false breakout, and the price may once again dip towards the 1.61 regions. However, combine this signal with the possibility of a new higher low, and it starts to paint a more bullish outlook.

If we also take a look at the daily Ichimoku chart for EURAUD below, the price is now above the cloud, along with the longer-term lagging span line in purple. Both of these elements indicate a strong bullish sentiment. This chart may also help explain why the pair has struggled these past few months with directional bias, as price action fought its way through choppy cloud support and resistance.

Back to the point and figure chart and should EURAUD continue to rise, nestled upside targets are within the 1.70-1.72 area. Alternatively, the whole continuation move might still have some juice to squeeze, and in this scenario a re-test of the 1.61 level to complete the next price swing down is probable.

 

Note: Click on charts to enlarge.

 

By Adam Taylor CTEe

.@adamt_trading

Sources: Go Markets, Meta Trader 5, TradingView, Bloomberg

Disclaimer: The articles are from GO Markets analysts,  based on their independent analysis or personal experiences. Views or opinions or trading styles expressed are of their own;  should not be taken as either representative of or shared by GO Markets.  Advice (if any),  are of a ‘general’ nature and not based on your personal objectives, financial situation or needs.  You should therefore consider how appropriate the advice (if any) is to your objectives, financial situation and needs, before acting on the advice.  If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.

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